🎯 $Gilead Sciences, Inc.(GILD) Options Strategy: Bull Put Spread (Short Put Vertical)

- Underlying: GILD

- View: Cautiously optimistic for a technical bounce from oversold conditions (RSI 17.83). Expecting the stock to hold above the $130 pivot and potentially consolidate towards $135.

- Strategy Type: Credit Spread / Defined Risk

- Option Contract Portfolio:

- Sell 1 GILD May 15, 2026 $130 Put @ $2.05 (Mid)

- Buy 1 GILD May 15, 2026 $125 Put @ $0.53 (Mid)

- Max Gain & Loss: Max Gain: $152 Credit, Max Loss: $348 (per spread)

- Initial Cost/Credit: Initial Net Credit: ~$1.52 per share ($152 per spread)

- Greek Exposure (Simulated):

- Delta: ~+0.24 (Positive, bullish)

- Theta: ~+0.12 (Positive, benefits from time decay)

- Vega: ~-0.04 (Negative, hurts if IV rises, benefits if IV falls)

- Gamma: ~-0.03 (Low, limited sensitivity to large moves)

- Rho: Negligible for short-term

- Rationale: This strategy capitalizes on the oversold bounce thesis and the current high IV (37.08%, 80th percentile). Selling the $130 put collects premium (high Theta) due to elevated IV. Buying the $125 put defines and limits risk below the key $125 support level. The positive Delta aligns with the bullish bias, while the negative Vega is acceptable as a bounce could calm volatility. The net credit provides a buffer, and the maximum profit is achieved if GILD closes above $130 at expiration.

- Time Frame: Short-Term (18 days to expiration)

How to pick expiration date of options?

When it comes to options trading, one of the critical decisions traders must make is selecting the expiration date for their options contracts. The expiration date refers to the predetermined date on which an option contract becomes void and ceases to exist. This date plays a crucial role in determining the potential profitability and risk associated with an options trade. ---------------- How do you pick expiration date of options? Share your valuable opinions and experiences!

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🎯 $Gilead Sciences, Inc.(GILD) Options Strategy: Bull Put Spread (Short Put Vertical)

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